This week, global central bank activities have sparked optimism among stock market enthusiasts. The Federal Reserve's decision to maintain its dovish stance and the Swiss National Bank's unexpected rate cut are key highlights, signaling a potential easing trend among global central banks this year.
Following record highs in Tokyo and Taiwan, the focus shifts to whether Asian markets will pause or continue their upward trajectory. Meanwhile, European stocks have ventured into new territory, and Wall Street has hit all-time highs, fueled by the Fed's decision to keep its fed funds target unchanged and its projection of rate cuts for the year.
The Swiss National Bank's rate reduction to 1.50% has weakened the Swiss franc, bolstering the dollar. Market expectations are now set on the Federal Reserve and the European Central Bank beginning rate cuts from their June meetings.
Japan's Nikkei 225 reached a record high, with investors awaiting the national Consumer Price Index data for February. Despite ending eight years of negative interest rates, the Bank of Japan maintains a near-zero rate policy, with Governor Kazuo Ueda expressing support for the economy through ultra-loose monetary policy amid rising inflation and wage pressures.
The yen has weakened since the Bank of Japan's policy shift, with the dollar/yen exchange rate nearing levels last seen in the mid-1990s. This suggests the yen carry trade remains viable due to low volatility and no immediate rate hikes.
South Korea's KOSPI is at a two-year high, facing its own inflation data release, while China's stock market struggles with property crisis concerns. However, Hong Kong's market has shown significant gains. Upcoming key developments include South Korea's Producer Price Index for February, Japan's Consumer Price Index for February, and India's flash Purchasing Managers' Index for March.
